US CMS
Cost and Schedule
Procedures
revision 0
June 30, 1994
prepared by
US CMS Project Office
This document details the cost and schedule procedures for the
US CMS collaboration. Guidelines are provided for developing
a work breakdown structure, and for estimating the labor,
materials, and contingency costs. Schedule guidelines will be
provided in a later version of these procedures.
These procedures are intended to guide US CMS subsystem managers and coordinators in developing project costs and schedules. The purpose is to provide a common approach and framework among the activities for which the US groups are responsible.
The costs and schedule will be organized using a work breakdown structure (WBS) format. It is intended that each of the subsystem managers and coordinators supply the details of the WBS for their subsystem subject to a set of general guidelines.
The steps of the WBS and cost estimate development, described in the following sections, are:
1) Develop an outline of the WBS elements which constitute the work breakdown structure for each level-2 WBS element.
2) Complete the definition of each WBS element for the WBS dictionary.
3) Estimate the cost of the activities which comprise the lowest level of the WBS, and complete the basis of estimate document for such activities.
4) Complete the cost estimate detail worksheet.
5) Complete the contingency analysis worksheet.
6) Complete the cost estimate summary.
This initial set of procedures contains guidance only on cost estimation. Schedule procedures will be added later for the preparation of the baseline cost and schedule associated with the technical design report.
It is envisioned that these procedures will be released as a controlled document to ensure that the US CMS cost and schedule estimates are prepared in a consistent manner. Revisions to this document will be issued as needed.
These procedures are based on those developed by the SDC collaboration (see SDC document SDT-000009).
The US CMS collaboration needs to develop an integrated work breakdown structure, cost, schedule, and tracking mechanism. The immediate goal is to provide realistic cost estimates for the September 1994 letter of intent submission to DoE, and to provide cost and schedule estimates for the December 1994 CMS technical design report.
An objective of the US CMS cost and schedule effort is to simultaneously meet three different project management needs:
1) US CMS project cost and schedule;
2) full cost and schedule for the CMS FMuon and HCAL subsystems;
3) integration of the US CMS project into the CMS cost and schedule at CERN.
The intent is to estimate and track the true cost of the US CMS project and of the two CMS subsystems (FMuon and HCAL) with over-all US project management responsibilities. Funding sources will include US CMS project funds, US HEP base program funds, and non-US funds. Provision must be made to identify and separate those project costs not included (e.g., EDIA, in-house labor, contingency, and project management) in the CERN CMS cost estimate.
The general approach will be to develop a resource-loaded schedule that directly ties labor and material costs to planned activities. All activities will be tied to a WBS element, and all cost element resources will be tied to an activity. The common element within the cost and schedule structure is the WBS.
The US CMS project office will coordinate a complete bottoms-up cost analysis, including EDIA, manufacturing labor, materials, and contingency costs. All costs will be estimated in FY'94 US dollars. Contingency costs will be estimated based on the risks associated with technical, cost, and schedule factors to obtain a composite risk estimate.
The WBS, cost estimate, and schedule structure will be organized by detector subsystem. The US CMS cost and schedule manager will be responsible for developing the top levels of the WBS; each US subsystem manager/coordinator will be responsible for developing and maintaining the lower levels of the WBS for their subsystem.
The master WBS and associated cost and schedule will be maintained by the US CMS project office, with cost and schedule tracking updated periodically by reports from the subsystem managers/coordinators. Cost and schedule variance and earned value will be tracked in a similar manner.
Subsystem and group coordinators are asked to break down their subsystem components into a hierarchy of WBS elements. Rules for WBS development beyond the summary level are as follows:
WBS elements are deliverables, and for the most part should be described as nouns. The engineering and design for a component are activities; the component is the deliverable, not the engineering and design activities. It is the component which constitutes the WBS element. The activities, such as engineering and design, appear at the lowest level of the WBS.
The only exceptions to the above rule are subsystem assembly, installation, system integration and test, and project management.
WBS elements will be numbered in the classical dotted decimal format. The first level of the WBS corresponds to the US CMS subsystem groups; the second level to the major components with US responsibilities.
Although no limits on the WBS numbering scheme are being imposed, the resultant WBS will be more manageable if the number of levels is limited to less than ten. In practice, it is seldom necessary to exceed six or seven WBS levels.
There is also an advantage in limiting the number of WBS elements at a given level to less than ten. If this practice is followed, ASCII sorts by WBS number will yield the desired result. This suggestion will not be enforced.
In the approach outlined above, the WBS is the direct link between the cost and the schedule. Every activity should identify a WBS element. This makes the "cost only" approach to WBS more difficult because one must not only identify all labor and materials associated with the product, but one must also develop a schedule of activities that will result in accomplishment of the deliverable. Thinking through the scheduling approach may lead to a revamping of the WBS that is finally used for the cost and schedule.
The ability to effectively communicate cost and schedule information between the project office and the subsystem managers/coordinators is vital. Current information will be available electronically at all times from information servers maintained by the project management office. The choice of project management software and platform will need to consider the data interchange capabilities of the product. The US CMS standard for project management software interchange will be the MPX format, which can be imported and exported by a variety of products, including Microsoft Project (Macintosh and Windows), MacProject Pro (Macintosh), Open Plan (PC, requires Selfware Project Converter), and Primavera (PC, use discouraged). The US CMS master WBS will be maintained with Microsoft Project on a Macintosh.
The initial WBS and cost estimate will be developed using Microsoft Excel or a similar spreadsheet.
The outline below lists the first two levels of the US CMS work breakdown structure. There is a one-to-one mapping between the level-1 elements and the US CMS subsystem groups, with the addition of elements which correspond to areas of potential common fund contributions (magnet and infrastructure) and project management. The level-2 elements correspond to the major detector components with US participation.
The US CMS WBS elements will be mapped into corresponding cost elements for the CERN CMS cost estimate at the appropriate WBS level.
WBS Element
1 Muon System
1.1 Endcap Muon Detection
1.2 Muon Steel and Integration
2 Hadron Calorimeter
2.1 Barrel Hadron Calorimeter
2.2 Endcap Hadron Calorimeter
2.3 Very Forward Calorimeter
3 Electromagnetic Calorimeter
3.1 Barrel Electromagnetic Calorimeter
3.2 Endcap Electromagnetic Calorimeter
4 Tracking System
4.1 Inner Tracker
5 Trigger
5.1 Forward Muon Trigger
5.2 Calorimeter Level 1 Trigger
6 DAQ and Software
6.1 Data Acquisition
6.2 Software
7 Magnet
8 Infrastructure
9 US CMS Project Management
9.1 Coordination and Planning
9.2 Systems Integration
The US CMS project is in the developing stage and many of the responsibilities have not yet been addressed or assigned. The following description attempts to delineate the responsibilities to develop the requisite WBS, cost, and schedule for the US CMS collaboration.
The project administrator directs cost and schedule efforts in support of decision making and technical proposal submittal, under the direction of the US CMS spokesperson, and evaluates differing options for US subsystem groups to determine which solutions meet CMS requirements and can be built within US CMS cost and schedule constraints. The project administrator is the point of contact for external cost and schedule reviews.
The US CMS cost and schedule manager, under the direction of the project administrator, oversees the development of the cost and schedule for the US CMS project, and assembles the master US CMS project schedule and funding model.
The cost and schedule manager is also responsible for establishing the methodology and approach used for cost estimation and scheduling. He/she is responsible for releasing and distributing the cost and schedule procedures document, and any updates or revisions to it, and will collect and disseminate information pertaining to cost and schedule efforts.
The US CMS subsystem leaders establish the subsystem configuration and parameters to meet the CMS project objectives for technical scope, cost and schedule. The subsystem leaders are responsible for providing information to their cost and schedule coordinators and for reviewing costs and schedules that are prepared.
The US CMS subsystem cost and schedule coordinators facilitate the development of detailed cost estimates and schedules for their respective areas. The coordinators develop the lower level WBS and dictionary, and administer cost and schedule activities to that WBS. The coordinators provide input to the US CMS cost and schedule manager, and are responsible for reviews of their subsystem cost and schedules. They maintain the cost book for their WBS elements, and are responsible for identifying and resolving interface issues between their WBS and other WBS elements.
The US CMS project is composed of a number of subdetector groups, each of which will be required to develop a cost estimate. US subdetector cost coordinators will be identified for each level-2 US CMS WBS element. They will have the responsibility of developing cost estimates in a manner consistent with the US CMS approach outlined in the following sections.
A work breakdown structure must be developed for each level-2 WBS element. The following format has been defined to document a single WBS element. This WBS definition and basis of estimate should be included as part of the subsystem cost book, and will be used for future cost reviews. A sample format has been included in Appendix A.
* interfaces with other elements
* drawing references
* list of key parameters
* key technical issues
* vendor estimate
* bottoms-up analysis (e.g., supported by manufacturing analysis, industrial engineering standards, etc.)
* historical reference
* parametric estimate
* top-down analogy
* engineering judgment
Seven labor categories have been identified for the compilation of labor cost estimates. They are:
AD - Administrator
EN - Engineer
EA - Engineering Associate
DR - Drafter
TE - Technician
LA - Laborer
CL - Clerical
The effort of scientific stall is not included in the US CMS cost estimate.
Labor codes will be constructed from the above category codes by appending a single letter, in "dotted" format, to identify the institution/funding source, followed by a letter to identify the labor type. Sample codes are shown in Appendix C.
To identify the specific institution where the labor will take place institution codes will be defined so the appropriate labor rate can be applied. Separate institution codes will be used for non-US labor or labor funded by the US HEP base program.
Each of the above labor classifications may be in support of manufacturing or non-manufacturing (EDIA) activities. A suffix of ".M" will be added to the above labor classification to denote manufacturing activities; a suffix of ".E" will denote EDIA.
Labor rates need to be established for the institutions at which significant labor will be performed. For others, generic labor rates may be used. Different labor codes will be designated to distinguish between US CMS project funds, US HEP base funds, and non-US funds, and to differentiate between EDIA and manufacturing labor. Example labor rates are provided in Appendix C. In determining which labor rates to use, the cost estimator needs to determine where the work will be performed, and to use the most accurate information available regarding the labor rates for that institution. All assumptions should be clearly stated in the cost book.
The labor rates used should be fully burdened with all associated costs. Typically, a burdened labor rate includes direct labor, fringes, overhead, and general and administrative costs.
Important: The labor rates should reflect the position that the US CMS is a capital project, and that all activities will be funded with equipment, rather that operating, type funds. All labor rates should reflect this approach, and not burden the labor payroll with operating type overhead.
Often, labor estimates do not include all the labor associated with manufacturing a product (e.g., manufacturing support, facility maintenance, etc.) because some of this effort is included in the overhead rate for that institution. A description of what is included in overhead at a given location should be provided.
A standard calendar of 250 days/year, based on 8 hours/day, 5 days/week, 10 holidays/year, which equates to 2000 hours/year, will be used for all activities. The standard unit of time will be the day.
The cost estimate should include all direct and indirect labor costs. The labor functions often vary from institution to institution, and are often accounted for in different ways (e.g., included in overhead, funded by other sources, not used, etc.). It must be clearly documented in the basis of estimate how each of the labor functions are accounted for.
The methodology behind developing the labor estimates should be included in the cost book as part of the basis of estimate, outlined in Appendix A. The methodology may range from engineering judgment, performance on historical projects, or detailed manufacturing estimates based on process plans or industrial engineering standards. The level of detail required is dictated by the total labor contribution to that element.
Manufacturing analyses performed to arrive at the labor estimate need to be spelled out. Analyses should be done to a level that ensures a high degree of confidence in the total effort estimated. For example, if thousands of like items are to be assembled in a high volume production setting, the credibility of the labor estimate will have to be very high or else a small change in the estimate will result in a rather large change in the total cost.
Labor estimates will also be affected by the manufacturing process assumptions made. Total labor will vary based on the level of automation assumed. University shops may be very labor intensive, while laboratory or industry settings may use automation to greatly reduce the labor required to assemble an item. There is a trade-off between labor-intensive operations at lower labor rates versus automated tooling resulting in less labor required but at a higher rate. The quality assurance program will also be affected by the assumptions made. The labor strategy needs to be clearly identified in the basis of estimate in the subsystem cost book by each subsystem cost coordinator.
Material costs include the purchase of raw materials for fabrication and the procurement of components, subassemblies, and tooling from outside sources, or items estimated in such a way that only a total dollar amount can be identified. It includes detector hardware, equipment, fixtures, tooling, utilities, test and assembly equipment, computer hardware and software, raw materials, and procurement processing. Travel is considered a material cost; travel for scientific staff is to be funded from the HEP base program, not the US CMS project. The cost book should indicate the basis for arriving at the materials cost estimate.
Material costs will be classified according to the expected funding source. The material codes are:
$USCMS - US CMS project funds
$USHEP - US HEP base program funds
$NONUS - non-US funds
Material estimates should be included as part of the cost book when used to arrive at material or procurement costs. The basis of estimate should also identify how the estimate was arrived at, and reference the vendor estimate if applicable. If the vendor's name is identified on the estimate, it is advisable to obtain their permission before publishing the estimate. If the vendor objects, simply identify the source as "Vendor A".
Risk analysis is to be performed for each WBS element. Results of this analysis will be related to a contingency which will be listed for each WBS element. The goal is to make the method of cost estimation and contingency determination uniform across all US CMS WBS elements.
1) Compare the conceptual state of the element with Table 1 to determine risk factors;
2) Compare the potential risk within an element with Table 2 to determine the appropriate weighting factors;
3) Multiply the individual risk factors by the corresponding weighting factors, and then sum them to determine the composite contingency percentage;
4) Do this for each element at a chosen level, preferably level 5 or 6 of the WBS;
5) Calculate the dollar amount of contingency for an element by multiplying the base cost by the calculated contingency.
Table 1
Technical, Cost, and Schedule Risk Factors
Technical Cost Schedule Risk Factor
Existing design and Off the shelf or Not used 1 %
off the shelf hardware catalog item
Minor modifications to Vendor quote from No schedule impact 2 %
an existing design established drawings on any other item
Extensive Vendor quote with Not used 3 %
modifications to an some design sketches
existing design
New design, nothing In-house estimate Delays completion 4 %
exotic based on previous of non-critical
similar experience path subsystem item
New design, different In-house estimate for Not used 6 %
from established item with minimal
designs or existing experience but
technology related to existing
capabilities
New design, requires In-house estimate for Delays completion 8 %
some R&D but does not item with minimal of critical
advance the experience and subsystem item
state-of-the-art minimal in-house
capability
New design, Top-down estimate Not used 10 %
development of new from analogous
technology which programs
advances
state-of-the-art
New design, way beyond Engineering judgment Not used 15 %
the current
state-of-the-art
Table 2
Technical, Cost, and Schedule Risk Weights
Technical Cost Schedule Risk Weight
Not used Material cost OR Same for all 1
Labor rate
Design OR Material cost AND Not used 2
Manufacturing Labor rate
Design AND Not used Not used 4
Manufacturing
In a spreadsheet format, create a copy of your WBS. Pick a level at which you will do detailed contingency analysis, and include the following additional columns:
WBS # Elem. Tech Cost Sched. Tech Cost Sched. Comp.
Desc. Risk Risk Risk Wt. Wt. Wt. Risk %
Input all information following the procedure outlined above.
Example: (from the SDC Si Tracker)
WBS # Elem. Tech Cost Sched. Tech Cost Sched. Comp.
Desc. Risk Risk Risk Wt. Wt. Wt. Risk %
1.1.1.4 Cooling 6 4 8 4 2 1 40
.1 Rings
1.1.1.4 Bridge 4 4 4 4 1 1 24
.2 Struc.
1.1.1.4 Coolant 4 3 4 2 2 1 18
.3 Distr.
A more detailed example is provided in Appendix D.
Keep all supporting information used in deriving risk factors. Most of the backup information will be the above spreadsheet itself.
The costs are to be summarized on a separate worksheet; an example is provided in Appendix E. The total materials, manufacturing labor, EDIA, and contingency costs are listed for each WBS element. The EDIA and contingency costs are also listed as a percentage of the base cost. The data for the cost estimate summary sheet is to be taken from the cost detail and contingency worksheets.
Worksheet templates for Microsoft Excel (or compatible) spreadsheets will be provided for the basis of estimate, cost detail sheet, contingency analysis, and cost summary sheet. Please do not embellish or otherwise modify the worksheet format; single space all entries. The worksheets will be collected and merged to obtain the over-all US CMS cost estimate.
The US CMS project will use the MPX format as the standard project management data exchange format. The master WBS, cost, and schedule will be maintained with Microsoft Project on a Macintosh.
Other compatible software includes MacProject Pro, Microsoft Project for Windows, and Open Plan (with Project Converter from Selfware).
The initial cost roll-up will be performed with the combined worksheets from each of the subsystems. The cost data will subsequently be loaded into project management software for development of the schedule.
[This section remains to be written]
0) Assume the schedule will change! Adopt a flexible scheduling approach.
1) Keep the schedule logic as simple as possible, consistent with reality. Use finish-to-start logic, with lag time as appropriate, whenever possible.
2) Include a "Task" and "OBS" (institution) item with each WBS element.
3) Separate EDIA, manufacturing labor, materials, and contingency costs.
4) Indicate the funding source for each item: US CMS project, US HEP base program, or non-US funds.
5) Use Start-of-Task and Start-of-FY milestones, and schedule tasks and other milestones with respect to these milestones.
6) Do not directly constrain the start or finish dates of any activities. Instead, construct and constrain milestones; e.g., FY milestones as above, or low-level schedule milestones invented for this purpose.
7) Do not use non-standard scheduling features such as Zero-Free-Float flags and Hammocks (if you don't know what these terms mean, good!).
8) Schedule costs to occur within discrete fiscal year boundaries. See 0) above.